How a lesser paying job makes sense to me

This may seem like a strange blog post. Why on earth would a finance blogger even consider a lesser paying job, and let alone be pleased about it?

Before you start thinking that I have lost my mind you better keep reading. Firstly, note that the new job that I have accepted is only at a 7% lower salary than my current position. This is not too bad although it does certainly impact on my day-to-day savings and financial goals. I did obviously negotiate and discuss things with the company, but in the end I am very happy with the offering and that is what this post is all about.

There are two ideas that I would like to share and hopefully you’ll understand that my decision isn’t as crazy as it sounds.

The Concept of “Zig-Zagging”

Have you ever climbed a really steep mountain and noticed how the path zig-zags up? You obviously want to get to the top, and the zig-zagging path is longer and seems more tiring. Sometimes you even seem to go the wrong way, but in the end you will actually reach the top. Unless you are a super-fit athlete, the zig-zag path is probably very helpful as it allows you to reach your goal at a slightly more manageable pace; sometimes it’s even quicker than the direct route!

Another example is using a GPS to find the quickest route through traffic to reach your destination. It may literally take you in the opposite direction in order to catch a back-road which will then quickly lead you to your destination.

The concept I am trying to bring across is that the most direct and obvious route is not the only route, and sometimes a slight detour can actually help you reach your destination quicker. As long as you know where you are headed of course!

In my case, the lower salary seems like a move in the wrong direction, but the experience, environment and opportunity is something that I feel confident will help me reach my ultimate goal a lot quicker. So for right now I just need keep focussed on my end goal and use this as a means to get there.

Money doesn’t always have to be the focus of everything, we need to look at the experience and work environment too. As well as the future growth opportunities.

The Happiness Factor

I don’t think that people pay enough attention to their happiness when it comes to their work. So many people are unhappy at work and simply plod along through the day doing what they need to whilst yearning to be somewhere else.

Being happy in ones job is seriously important as the consequences spill over to all spheres of life. Family, relationships, home environment and health are just some of the areas that will be negatively affected if you’re unhappy at work.

Wasting years of your life by being unhappy is really not worth the money – not at all!

I do however need to be honest and say that my current job is really not that bad, but I know that I can be happier with a few changes in the environment and setup and thus I am willing to sacrifice some money in order to increase my happiness.

On the positive side, when you’re feeling happy and motivated at work it also spills over to other areas of life. When you are positive, confident, motivated and happy you will find amazing opportunities that you previously just couldn’t see.

In summary

I may be sacrificing some income which should be going straight towards my investment goals, but I am excited about the new opportunity and environment. There is a lot of room for growth and development which will soon turn into money and place me in a better position.

When looking at a job don’t simply look at the salary, think bout the opportunities and work environment too. It’s a scary thought, but you probably spend more time at work than anywhere else! You better be enjoying it!

Know where you want to get to and enjoy the ride.

Awesome quote from the Dalai Lama

One of my favorite quotes is this:

The Dalai Lama was asked what surprised him the most; he said,

“Man, because he sacrifices his health in order to make money. Then he sacrifices money to recuperate his health. And then he is so anxious about the future that he does not enjoy the present; the result being that he does not live in the present or the future; he lives as if he is never going to die, and then he dies having never really lived.”

Find the Balance

balanceIt’s hard finding the balance between saving for the future, and living for the now. You don’t want to lose out on the wonderful experiences that life can offer you right now; but at the same time you don’t want to end up in a dreadful financial situation when you’re nearing retirement.

So how does one know how much to spend and how much to save? And how do you decide what you can afford to do now and what will be worth it in the long run?

Well, there is no right answer! These decisions will always be tough and sometimes you’ll make the right choice, and sometimes not. The trick is to try and make the right choice more often than not.

It all starts with assessing your current situation and knowing exactly where you stand with regards any debt you may have, as well as commitments you have made. Debt is a bad thing, so take serious look at this! Also, you need to know exactly what you (and your spouse) bring in each month, and exactly how much you spend. It’s this monthly spending where lots of problems come in. You cannot be spending more than you earn; this will cause unthinkable issues in the future and if that is currently the case, you need to fix it! Just stop spending on non-essential items, don’t eat out, don’t buy things you don’t really need, don’t be influenced by your friends to spend when you cannot actually afford to.

When looking at your monthly expenses, think about the value of “things” versus “experiences”. Let’s say you often buy take-aways, think about what else you could use that money for? Would you enjoy to have a massage or go away for a weekend break? How many take-away meals should you substitute with a home-cooked meal in order to have these other experiences?

It’s not a bad thing to buy take-aways, provided you have budgeted for it. The point I’m trying to make is that money wasted could be used so much better! We all have a limited amount of money we earn each month and every single cent that we spend is worth something! We need to slow down on the spending and be conscious of what we are doing with our money.

So back to the beginning, how do we now how much we should be spending and how much we should be saving? Start with assessing your current situation, create a budget and decide on any financial goals. You may need to tweak your budget to make it all work out, but that’s exactly the point of a budget. Work out what you can spend now in order to achieve what you want to later on.

Challenge: Think before you spend!